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Hello Crazy Folk,
What do we do about the banks, then? It's a difficult question. In the early summer, we probably all felt a lot happier with money in bank shares than in many other areas.
But now? Well, it's stunned a lot of us to find that the slow, but sure, gains in share prices enjoyed by banks for six years now, have nearly all gone into reverse.
In one case - the Northern Rock (NRK), of course - this reverse was serious. And this share price dropped so much that it hid the fact that the other banks had also fared pretty badly.
But what about the future? Are we safe to invest in banks again? Well, there is a view that the worst might not be over - that more bad news about the US sub prime mortgage thingy is yet to come.
The other view - and it's one I support - is that the banks have now had a hard lesson, and hopefully, they won't make the same mistakes in the future.
And if they do not continue to pour money into less-than-safe mortgages, then surely the money might start coming in again. Possibly quite a lot of money.
Barclays (BARC) is just one UK set-up which was found not to have the same money problems as the City seemed to think it had. It expects to make another record profit. Surely the other banks might recover fast and put the whole banking shebang back on course. That's what I think - but like everyone else in Crazyland, I run the risk of getting it wrong. Rocking on!
To find out more about Malcolm CLICK HERE
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